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RTI: Ending the tax year in real time

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3rd Apr 2013
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Helen Hargreaves, senior policy and research officer at the Chartered Institute of Payroll Professionals (CIPP), looks at what is required to make your first submission in real time at the end of the tax year.

For most employers this won’t take effect until April 2014, but those employers who are on the RTI pilot will be getting ready to close the tax year in real time.

You will all have heard that the P35 will no longer be part of the PAYE process once an employer starts to submit in real time. Instead, the end of year declaration needs to be made as part of the final FPS or EPS that you submit for the tax year. At the end of the tax year, submit your final FPS and/or EPS for the pay period as normal. You must indicate that it is your 'Final submission for the tax year' and then answer the end of year declarations and questions that will be familiar to you from the P35 form. You must do this even if you have not made any deductions of PAYE tax or National Insurance contributions (NICs) from employees in that pay period.

If you submit more than one FPS in a tax month, for example, for weekly and monthly payrolls, your final submission will be the last FPS or EPS that you submit for that tax year, regardless of whether it relates to the weekly or monthly payroll.

But the most important difference for you to remember is that the deadline of 19 May, which has always existed as the ultimate deadline for submission of the Employer Annual Return, will not apply once you start submitting information in real time.

If you are submitting a final FPS, indicating a payment being made, you should submit this no later than the 5 April. If no employees are being paid during tax month 12 you will need to submit an EPS, including the end of year declarations and confirmation that this is the final return for the tax year, no later than 19 April.

The deadline of 31 May still remains for you to issue forms P60 to all employees who are employed by you on 5 April. Duplicate P60s no longer need to carry the annotation “duplicate” as has previously been required.

Next month we will look at how to amend information you have already submitted on an FPS, and what you should do when you receive a P45 from a new employee, the answer may not be quite as straight forward as you think.

Contacting HMRC about going live

So just how do you contact HMRC if you cannot comply with the instructions or indeed if you encounter any other problem or need information?

Your first port of call should be HMRC’s website. The RTI pages are very comprehensive so it is likely that you will find the answer to your query, it may just take some time. HMRC has also included a troubleshooting page which looks in more detail at the common situations which arise in payroll and explains how to resolve them in the new RTI regime.

Your software provider will also be a great source of help and information as their software solution, whilst meeting general data guidelines, will be unique to their product.

But if you do need to make contact there is HMRC’s Employer Helpline on 08457 143 143 for PAYE process issues or the Online Services Helpdesk on 0845 60 55 999 for software and technical issues.

Helen Hargreaves is a senior policy and research officer at the Chartered Institute of Payroll Professionals (CIPP).

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By howardwalters
03rd Apr 2013 11:46

But next year

the 5 April concession will be gone and the final FPS together with the P35 like questions will have to be submitted on or before the last payment. This could be the first half of March for some firms in which case they will have to know the answers to the following well before the end of the tax year:

 

Any 'Free of tax' payments made to an employee.Did anyone else pay any expenses or benefits to any of your employees while they were employed by you during the year.Anyone employed by a person or company outside the UK working for you in the UK for 30 days or more in a row.Any of an employee’s pay you've paid to someone other than the employee, such as to a school.If you need to complete forms P11D and P11D(b) for the tax year.If you're a service company (if the company is a Service Company and operates the intermediaries legislation, known as IR35 or Managed Service Companies legislation).

Most of the questions can be answered fairly easily prior to the tax year end but one requires enquiry of 3rd parties and the P11D question can't possibly be answered with any degree of certainty until the tax year has ended on the 5 April - too late for the submission!

Does anyone have any idea of how to square this circle - or am I missing something?

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By gary.ging
03rd Apr 2013 15:09

Use the EPS

Hi, you aren't missing anything but it is also possible to do want you want.

The only rule HMRC have defined here is that the end of year declarations must be included in the last submission of the year, and this could be either a FPS or an EPS, they do not have to be sent by the time the last payment is made.

While a FPS will have to be sent by the 5th April (because this is the last day in the year in which you could pay somebody, therefore the last day on which you can adhere to the 'on or before' rule) you have until the 19th April before you have to send the EPS.

The last EPS you send does not have to be for an adjustment or a nil payment, it can just include the declarations if you want, so regardless of the situation, you can adhere to all of the RTI rules and wait until the 19th April before sending the declarations.

Whether or not you are able to do this will be down to the software that you use and how the different RTI submission types have been implemented.

This is how we have designed the end of year process within our RTI software.

Gary

Sage UK

 

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By howardwalters
03rd Apr 2013 16:39

EPS - you're my hero

Thanks Gary - what a relief.

Howard

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